WTO talks stagger into last day, deal elusive

Protesters try to break through a police line near the site of WTO talks. Picture / Reuters

HONG KONG - Exhausted negotiators struggled to end feuding and keep a global trade deal alive in a final day of talks as riot police rounded up anti-globalisation protesters after violent clashes in Hong Kong.

As talks among the World Trade Organisation's (WTO) nearly 150 members staggered into a sixth day, diplomats said the European Union looked ready to accept a date for ending farm export subsidies, a key developing country demand.

But it was uncertain this would be enough to overcome deep divisions that stretch from how quickly the United States will dismantle cotton subsidies that African producers say are ruining them to special measures to help the WTO's poorest states.

"The problems we have faced all week continue, in agriculture, industrial goods, cotton," said WTO spokesman Keith Rockwell during last ditch talks that began late on Saturday.

Without a deal in Hong Kong, the free trade round could collapse, plunging even the future of the world trade body into doubt.

Yesterday, Hong Kong police fought running street battles and fired volleys of tear gas to repel hundreds of mainly South Korean protesters trying to force their way into the convention centre where the trade ministers were meeting.

The South Koreans, mainly farmers who say the WTO is driving them out of business, staged a final sit-down protest before police moved in and arrested them.

Eighty-two people were injured in the fighting, including 12 police officers, the government said. It was the worst violence in Hong Kong since protests following China's bloody crackdown on democracy protesters in Tiananmen Square in Beijing in 1989.

But the fighting was less intense than the "Battle of Seattle" in 1999 when protesters succeeded in delaying the start of a WTO ministerial conference that had initially been intended to launch a new round of trade negotiations.

The current round was finally started in Doha in late 2001 in a bid to calm a jittery world economy after the September 11 attacks on New York and Washington.

SUBSIDIES CUT?

Inside the harbour-side convention centre, negotiators were wrangling over a draft text put together by WTO chief Pascal Lamy and conference chairman John Tsang, Hong Kong's commerce secretary.

Trade diplomats said the EU would agree to eliminate farm export subsidies in 2013, five years after any new trade treaty would take effect, but only if developing countries showed more willingness to open industrial goods' and services' markets.

Those subsidies are currently worth about 2.7 billion euros a year, a small part of the EU's annual spending of more than 40 billion euros ($69.5 billion) on agriculture.

Ending the payouts in 2013 would coincide with the end of the current budget period for the EU's Common Agricultural Policy, potentially making it easier for the cuts to be made.

But the Brazil- and India-led G20 developing country alliance was still pressing for have some subsidies go by 2010, their preferred date.

The Doha round was sold to developing countries as a way to speed their economic growth.

But a plan to give poor nations free access to the markets of the world's biggest economies has run into problems because the United States is worried about textile imports from fast-growing Bangladesh and Cambodia in the programme.

A senior US lawmaker warned the draft WTO text would not pass Congress in its current form because it did not break the impasse on agriculture and requires more concessions from rich countries, with few new commitments from the developing world.

"I seriously doubt that any agreement with this imbalance will be acceptable to the US Congress," Senate Finance Committee Chairman Charles Grassley, whose committee has jurisdiction over trade legislation, said in a statement in Washington.

But poorer states have also warned that they could block any deal if their demands on duty-free access are not met.

"LDCs have reached a tipping point ... Let me confirm that it is easy to walk away from something that will leave us no better off than we were before," Zambian Trade Minister Dipak Patel said.

- REUTERS